Don’t Monthly Payment Yourself to Death

Most people are probably painfully aware that gas prices have been rapidly increasing over the last couple of years (and especially months), thus also increasing the costs of any items needing to be delivered from anywhere, the most common being groceries. Many people are feeling the crunch in their budgets as they find themselves having to pay more for the same amount of groceries and gas, yet not earning any more income.

So how can you lessen the blow of these rising costs on your own budget? I believe much of it has to do with how your budget is structured. For the most part, people can benefit greatly by not budgeting every last dollar they make. Now I’m not suggesting that

6 Responses to Don’t Monthly Payment Yourself to Death

Great advice – personally I have been simplifying the monthly payments that go out – trying to consolidate and really thinking hard before signing up for that new subscription or service. Not only is there more money left over but you get rid of the overhead associated with tracking and paying the expense each month – which, however small, contributes a bit of hassle or stress when money is tight.

One thing we do is avoid those contracts. It rarely saves you that much, and (unless you are getting a cell phone) you can usually convince the provider to give you the contract rate anyway. That way if something comes up, and you need to cancel something, it is easy and doesn’t cost you a fee.

For the cell phone, we just have a pay as you go phone. We never use the cell phone unless it’s an emergency anyway.

It is sometimes difficult to lower expenses in the beginning when you are getting out of debt. One reason could be contracts. Another is that every penny that you do have left over is paid to the debt.

I, like you found out that it is not a good idea to budget every penny. Now, Dave Ramsey might not agree with this but he does have a budget line item called “blow money”.

We have a budgeted expense called “UNALLOCATED FUNDS’. It is just that. Unallocated funds used as a catch all for miscellaneous items like expenses that go up in price but not yet budgeted for. It could be for photos, or anything unexpected. At the end of the year, I transfer any money left into savings.

It feels really good to have some wiggle room in the budget. We’ve always tried to have small payments so we have more flexibility.

But since you don’t have any car payments…this is a great time to make a plan to set aside money for the next car. Even if you have a lot of good years left in those old cars, you’ll need to replace them eventually. If you set aside a “car payment” each month, you could be ready for the next car…maybe even able to pay with CASH!